Hunt v Watkins & Ors - 40740/02; Watkins v GRE

LOWER COURT District Court JURISDICTION : LOWER COURT DC 44/92 FILE NUMBER(S) : LOWER COURT Delaney DCJ JUDICIAL OFFICER :

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 40740 of 2002 40696 of 2002

MEAGHER JA HANDLEY JA BEAZLEY JA

31 October 2003 KAREN JOY HUNT v PAUL DAVID WATKINS & ORS PAUL DAVID WATKINS v GRE (UK) LTD & ORS CATCHWORDS NEGLIGENCE - accident in dodgem car - negligence of operator not established - no question of principle

INSURANCE - son claiming benefits under father's policy - right not established - no question of principle FACTS

The claimant Ms Hunt sought leave to appeal from a judgment of Delaney DCJ in favour of the defendant. She claimed to have been injured when a dodgem car being driven by her then de facto husband in which she was a passenger collided heavily with the side of the dodgem rink. It was raining at the time and because the rink was protected by an open tent, it was wet. She sued the operator of the rink for negligence claiming that the accident was due to the presence of excessive water on the surface of the rink but the trial Judge held that negligence had not been proved.

HELD: Although some of the reasons given by the trial Judge could not be supported, these errors were immaterial as other reasons given for entering judgment for the defendant could not be disturbed. The summons for leave to appeal was dismissed with costs. The defendant joined as cross-defendants the insurance companies that had issued a public risk policy to his father covering the dodgem cars. The Judge found that the defendant was entitled to indemnity under the policy but dismissed the cross-claim with costs because the defendant succeeded in the action. The defendant sought leave to appeal against the costs order. HELD: The defendant failed to prove that he was entitled to any benefit under his father's policy and his summons for leave to appeal was dismissed with costs. ORDERS

Hunt v Watkins - 40740/02

1. Leave to appeal refused.
2. Claimant to pay opponents' costs.

Watkins v GRE (UK) Ltd & ORS

1. Leave to appeal refused.
2. Claimant to pay opponents' costs.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 40740 of 2002 40696 of 2002

MEAGHER JA HANDLEY JA BEAZLEY JA

KAREN JOY HUNT v PAUL DAVID WATKINS & ORS PAUL DAVID WATKINS v GRE (UK) LTD & ORS Judgment 1 MEAGHER ACJ: I agree with Handley JA. 2 HANDLEY JA: The Court has before it two summonses for leave to appeal from decisions of Delaney DCJ, one on behalf of the unsuccessful plaintiff, and the other on behalf of the successful defendant who was ordered to pay the costs of insurers joined as cross-defendants. It will be convenient to deal first with the plaintiff's summons. 3 The plaintiff and her then de facto partner, Mr Paul O'Leary, visited the Wauchope Show on the evening of Friday 20 April 1990. They decided to take a ride on a dodgem car on a rink operated by the defendant, Paul Watkins. It was a wet night and because the rink was under canvas open to the elements on three sides and part of the fourth the rink was wet. 4 After riding around for about 10 minutes Paul O'Leary, who was driving the dodgem, appeared to lose control of the vehicle which drove front on into the side of the rink. The plaintiff, who said that she was in her seat belt, was jostled by the impact, and claimed to have broken her right kneecap. She commenced proceedings against the defendant Mr Paul Watkins, as operator of the dodgem rink in September 1992, but for unknown reasons the first trial did not commence until May 1999. The plaintiff's case on liability at this trial was based entirely on her own evidence. Blanch CJ upheld a submission of no case and entered judgment for the defendant. In August 2000 this Court allowed the plaintiff's appeal and ordered a new trial. 5 The new trial commenced before Delaney DCJ in October 2001. The transcript of the plaintiff's oral evidence at the first trial was admitted by consent (black 71-140), and she was recalled to give further oral evidence (black 6-34). There was no other oral evidence on liability in the plaintiff's case, but an expert report by a Dr Hill was tendered on her behalf. He was not required for cross-examination. The defendant, David Watkins, also gave oral evidence. The Judge delivered his reserved judgment on 18 February 2002, having pronounced orders without giving reasons on 25 January. The plaintiff's action was dismissed, but the Judge assessed her damages at $63,234.30. The parties have been fully heard on the application for leave and the Court can determine the case without a further hearing. 6 The statement of claim alleged that the plaintiff purchased a ticket from the defendant entitling her to the use of one of the dodgem cars, but the evidence did not support this. She said in both trials (6, 108) that Mr O'Leary purchased the ticket, and the defendant said (28) that the ticket entitled the holder to the use of a dodgem car with or without a passenger at no extra cost. Although the plaintiff was not a contractual entrant, the present case does not turn on any difference between the contractual and general tort duties of care. 7 The plaintiff gave evidence before Delaney DCJ more than 11 years after the accident and the Judge said, unsurprisingly, that her capacity to recall and her accuracy of recall had been affected by the lapse of time. The Judge was concerned that Mr O'Leary, who was driving the car at the time, was not called in the plaintiff's case, and he drew a Jones v Dunkel inference against her. 8 The plaintiff's evidence was that the dodgem got out of control on a large puddle of water on the rink near the ticket office. The whole of the rink was wet, but the water was deeper in the puddle which was about 10 feet x 8 feet. She said that the accident occurred when Mr O'Leary, in an attempt to avoid a pile up of cars in the middle of the rink, moved his car to the side where it hit the puddle and he lost control. 9 Dodgem cars are three wheeled fibreglass vehicles driven by an electric motor. The circuit runs from the aluminium floor via the rear metal wheel to the electric motor and then up a vertical rod at the back of the vehicle to a metal wheel which runs on a wire mesh ceiling under the tent. The steering wheel between the two passenger seats, as shown in the photograph ex B, controls the single forward rubber wheel which can rotate through 360° to make the car go in any direction. 10 The cars have no accelerator and no brake. Depressing the foot clutch in front of the driver causes the car to move and releasing the clutch causes it to stop. Dr Hill said that there was no need for any additional braking capacity beyond that provided by the drag of the electric motor. 11 Dr Hill said that the presence of water would reduce the friction between the wheels and the rink. The car could move at a speed of 8 kph. If there was enough water on the rink the front wheel would aquaplane on the surface so that the effective friction on that wheel would be zero and the car could not be steered. However he said that this would not cause the car to speed up, although this would be the perception of someone in the vehicle. He added that a pool of water and a quickly moving car would result in the wheels aquaplaning, reducing the friction to almost zero. 12 Mr Watkins said that the dodgems did not move faster than a walking pace which is consistent with Dr Hill's evidence of a speed of 8 kpm. Mr Watkins said that they have a single speed motor (25). 13 The plaintiff said she had seen the large puddle of water and marked its position on ex B (74). It was there when she stepped into the car but she did not realise it was such a large puddle until she was in the car and on the track (131). Drivers were trying to avoid it (97), and she said that when the car "hit the water" the electricity was affected (75, 99, 131). She said that "it was obvious when you hit the water you lost control" (101, 108, 114-5). 14 She said that a largish boy about 14 was doing something about the puddle. He was trying to squeegee the water off the track (75). She noticed the boy doing this before she went for the ride (131). He remained on the rink after the cars started, still trying to get the water off (108). 15 The Judge did not accept the plaintiff as a reliable witness. He found [par 20] that her observations about the event were inaccurate, and she was wrong in her recollection of what actually happened. A positive finding that the plaintiff was wrong cannot be supported because there was no other direct evidence about the accident and the plaintiff was not cross-examined to suggest that there was no puddle on the rink, or that she had not injured her right knee in the car. Moreover Dr Hill's report explained how the accident could have occurred in the manner she described. 16 However the Judge made other findings as to the plaintiff's reliability which are not open to these objections. He found [par 20] that she "assumed" that it was the wet patch which caused it to slide and [par 22] that "the plaintiff had no real recollection of the surface of the rink", other than that it was all wet, and [par 27] that she had "reconstructed her recall about the extent of any puddles". He said [par 22]: "She could not recall the nature and construction of the rink, which is understandable having regard to the effluxion of time however to try and recall and then to suggest that she recalled the precise state of wetness of the rink, and fix upon the defendant the obligation for removing such wetness without the corroborative evidence of Mr O'Leary, in circumstances where there was action being taken on the part of the defendant to remove any wet area, is in my view unacceptable to place liability on the defendant". 17 Mr Watkins gave evidence that he operated these amusement devices all over eastern Australia and all year around. He operated them during rain and had done so on numerous occasions (24). His family had been in the business for many years. There was no evidence of any other accident and injury with these cars before or after this accident. 18 He also rejected the plaintiff's case for reasons which did not depend on his assessment of her oral evidence. The Judge said [par 24]: "The defendant was attempting to remove any wet area from the rink at the relevant time, and ... it was not necessary to have an enclosed structure to conduct the dodgem car ride. I find it was not necessary for the defendant in the circumstances to stop the ride until all the wetness was removed or to stop the ride altogether when it was raining". 19 He was satisfied [par 25] that the risk created by the wet condition of the rink did not require the defendant to do more than was already being done to remove surplus moisture. Mr O'Leary was not called as a witness and the plaintiff had not observed what he had done when driving the vehicle, and the Judge said that he was not satisfied that the plaintiff had discharged the onus of proving that the incident was caused by the wet condition of the rink [par 27]. Finally he said that the plaintiff had not proved a breach of duty by the defendant because "there was nothing that the defendant did or omitted to do which was called for in the circumstances as a response to the risk of injury" [par 27]. 20 The Judge said that Mr O'Leary's absence had not been explained, but it had been. The plaintiff and Mr O'Leary lived in a de facto relationship until 1995 and she had borne him a son. Following their separation she obtained an apprehended violence order against him (7, 103), although it was no longer in force at the time of the trial. Mr O'Leary had rights of access to their son and they continued to meet in that way but hardly spoke [7]. This evidence explained why Mr O'Leary was not called even though the plaintiff did not give this explanation when asked if he would be called (16, 98). 21 In view of this evidence a Jones v Dunkel inference was not available against her. Nevertheless the absence of Mr O'Leary left a significant evidentiary gap. The fact that it cannot be filled by an inference adverse to the plaintiff does not mean that it can be filled by an inference in her favour. 22 The plaintiff said: "Being on that platform thing that the dodgem cars go on, it was obvious - we weren't the only one that it sort of hit the water and it was obvious when you hit the water you lost control" (108). 23 She said that in the 10 minutes before the accident their car had travelled over wet parts of the track, that it behaved differently over a wet part of the track, and this "was quite obvious to everyone on that track at that time" (109). People were trying to avoid the big puddle (97), and Mr O'Leary had tried to avoid the puddle in going around the track (131). There was a pile up of cars in the centre and Mr O'Leary slowed down and went around them (117). The plaintiff was paying no attention to what Mr O'Leary was doing with the clutch pedal (15), and she did not see him take his foot off the pedal, or was aware that he had done so (117). After the vehicle began to slide Mr O'Leary kept turning the steering wheel but he did not regain control before it hit the side (75). The plaintiff said in cross-examination (99): "Q And so it's fair to say isn't it that you are assuming , by reason of the fact that you had a collision, that Mr O'Leary lost control in the water? A. Yes". (emphasis supplied) 24 Thus the Judge's finding that the plaintiff "assumed" that it was the wet patch which caused the car to slide [par 15 herein] was directly supported by her evidence. 25 She said that Mr O'Leary had been trying to avoid the puddle because of "the electricity" (75, 131) and others were trying to avoid it because of sparks and loss of control (93-4). However she said that when the car appeared to go out of control and crash the power was not cut off. (101). 26 It seems therefore that their car had been in the area of the puddle before without coming to grief (109). The evidence does not reveal whether Mr O'Leary could have avoided the puddle on this occasion by steering away from it or stopping before he got too far into it. The plaintiff said she did not know why Mr O'Leary did not avoid the puddle or just stop the car (99). The Court does not know whether he was keeping a lookout or was looking elsewhere, perhaps at the pile up. It is not known whether the apparent loss of control was due to his negligent driving, or whether he thought it would be "fun" to drive into the puddle or turn the wheel hard to see what happened. She did not say anything to Mr O'Leary when the car was out of control (115). 27 The Judge quoted at length from the plaintiff's evidence [par 21] and held that she had no real recollection of the condition of the rink except that it was all wet. Where her accuracy of recall could be checked against objective facts it was often found to be unreliable. She said that the steering wheel was in front of the right hand side (74), but ex B shows that it was between the passengers and the plaintiff later agreed that this was so (111-12). She said in the first trial that the barrier at the edge of the rink was timber (75, 97, 101, 115, 122, 132), but when cross-examined to suggest it was metal she said that she couldn't recall, she could not say whether it was metal or wood, but thought it was wood (139-140). At the second trial she again said that the barrier was wood and not steel (16) and was sure it was wood (18). Mr Watkins said that the barrier has always been steel and has never been wood. Steel is used because it does less damage to the rubber bumpers on the cars (23, 27). 28 The plaintiff first said that the cars were metal but then accepted in cross-examination that they were made of fibreglass (13). She said in the first trial that the rink had a masonite topping, some sort of timber surface which had bowed, and that was how the deeper puddles formed (110). She then said she was not sure it was a wooden surface, she couldn't recall "but that's obviously the reason why this big puddle was there" (110). She said masonite because this was the first word that came into her head to describe the surface (110). Later when it was suggested to her that the rink was metal she said she was not sure, that maybe it has to be metal for the electricity, but she was not sure (140). 29 In the second trial she first said that the rink was timber and then said that it was metal for the electricity to run, and then that it was a timber floor with rubber over it. She finally said that it could be aluminium (16). Mr Watkins said that the rink was always aluminium because it takes the current (23) and Dr Hill said the cars run on a metal surface (blue 41). 30 She said she saw water coming onto the rink from the roof in the form of a continuous light drizzle and drips all over the rink (76), and that the roof was leaking (97). Mr Watkins said that there was no water in the middle but only on the sides (24), and the Judge said that the photos (exs A and B) showed that the tent covered the area where the rink was situated and did not reveal any defect in the roof [32]. She said that after their car had hit the barrier a second car did so, and the timber barrier moved and became detached (76, 101, 132). Mr Watkins said that the steel barrier hooks in all the way around and is pinned in that situation. It does not come off because cars hit that barrier hundreds of times during the course of any show (23). If the barrier had come off, it would have been necessary for a member of staff to refix it, but the plaintiff gave no evidence that this happened, and Mr Watkins, who was on duty, was not cross-examined to suggest that it did. Indeed his evidence that the barrier was steel and cannot be bumped off was not challenged in cross-examination. 31 The plaintiff had twice previously ridden on dodgem cars (107, 132). She agreed that it was the nature of these cars that you can't always go where you want to go (132). She knew that dodgem rides can be violent (96). People go around bumping into each other and into the sides (93), and it is a reasonably rough, jolting activity (95, 97). People are losing control of the cars all the time and part of the fun is spinning around and bumping into people (99). Mr Watkins said that people ride in them to have fun bumping into each other and getting a little bit tossed around (29). There was a sign on the back canvas wall of the rink stating: "Enter at your own risk", which the plaintiff noticed before getting into the car (108), there was a sign to that effect in the ticket office (28), and the ticket carried the same message (27, 28, 108). 32 While, as I have said, some of the Judge's reasons for rejecting the plaintiff's claim cannot be supported, others are amply supported by evidence and not vitiated by legal error and I refer to some of these in the following paragraphs. 33 The Judge was not satisfied that the plaintiff had a real recollection of the condition of the surface of the rink other than that it was wet [22]. He said it was unlikely [par 24] that a puddle, such as the plaintiff sought to describe, was present at the time. The plaintiff's explanation that the puddle had formed in a bow in the timber floor must be rejected, and Mr Watkins said that the water was on the sides of the rink. 34 The Judge said it was not necessary to have an enclosed structure and the rain did not make it necessary to stop the ride altogether [par 24]. Mr Watkins said that his practice was to continue operating during rain. There was no evidence to the contrary and no expert evidence that the practice was dangerous. The Judge found that the risk did not require the defendant to do anything more than was already being done to remove surplus water [par 25]. In any event, he said that the evidence did not show that the presence of the water caused the injury because there was no evidence of what Mr O'Leary was doing immediately before the accident [par 26]. 35 These reasons, which were not vitiated by error, fully support the judgment for the defendant and the other errors are immaterial. Moreover the decisions in Agar v Hyde (2000) 201 CLR 552 and Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460 support a cautious approach to duty and breach questions in the context of the known risks of sporting and similar activities. I would therefore refuse leave to appeal and dismiss the plaintiff's summons with costs. 36 The defendant cross-claimed against the insurance companies which had issued and renewed a public liability policy 501/CLY8900206, which was in force at the date of the accident. The only evidence of the terms of this policy is a renewal notice issued by insurance brokers dated 23 January 1990 (blue 50). This states that the insured is Val Vern Watkins and the policy was for legal liability to the public, inter alia in respect of dodgem cars. The document acknowledged that the premium had been paid and stated "cover as more specifically defined in the policy wording". 37 The statement of cross-claim (red 19/20) alleged that the policy was issued to the defendant's father, that the defendant was the owner of the dodgem cars that were insured under the policy, that the defendant had paid the premium, and in the alternative that the defendant and his father operated the dodgem business in partnership, and the father had obtained the policy on behalf of the partnership. The statement of defence of the cross-defendants put these matters, other than the issue of a public risk policy to the father, in issue. 38 The defendant's evidence in support of these allegations was extremely limited. When asked whether he was the owner of the cars he said he was the owner in respect of the green card in workplace health and safety (25). A certificate of registration under regulation 157B(5) of the Regulations under the Construction Safety Act 1912, which is apparently known as a green card in the trade, was admitted in evidence (blue 48-9). Such a certificate, like the registration of a motor vehicle, is not necessarily proof of ownership. 39 When asked if he had public liability insurance at the date of the accident he said: "Well I thought I did". He then said he rang Mr Nugent, his insurance broker, about 3 weeks before the accident, and that he always pays his insurance premium in May (26). He was shown the certificate of renewal and asked whether that was issued to him and he replied: "No, that's issued to my father" and his father had paid the premium (26). When asked whether he had come to some arrangement with his father in relation to the premium he said: "There was no arrangement on that particular insurance policy there, that policy was covering the dodgem cars and my father was operating them" (26). He then said that he rang Mr Nugent and asked him to put the cars "on my policy", and he was under the impression that this had been done. He had a further conversation with Mr Nugent when he was in Queensland in May and told him: "It wasn't on my policy" (27). 40 In cross-examination he confirmed that he paid his insurance on different policies in May each year (31, 33). He also gave evidence about a payment of $600 or $800 to his father towards the latter's premium and added: "I didn't pay no insurance company or anything like that". He paid his father this amount prior to the Wauchope Show (33). He said that the dodgem cars were owned by his father (31) who had paid for them (29) and that he had not bought them from his father. 41 This evidence did not prove the allegations in the statement of cross-claim. The certificate of registration did not establish that the defendant was the owner of the dodgem cars in April 1990 having regard to his oral evidence that his father was the owner. The defendant had not paid the premium on his father's policy, at its highest his evidence established that he had reimbursed his father for some part of that premium because the cars "were still insured in his name". 42 There was no evidence of any partnership with the father, but there was evidence of a partnership tax return for the 1990 tax year on behalf of the partnership between the defendant and his wife (32). Moreover neither the policy nor the policy conditions were in evidence, and there was no evidence from the defendant, his father or the broker, or otherwise, that the father's policy was intended to cover, or did cover, the defendant at the time of the accident. 43 In fact the defendant had his own public liability policy which was renewable in May each year in contrast to his father's policy which was renewable in January. Prior to the Wauchope Show he said he telephoned his broker, Mr Nugent, and asked him to put the dodgem cars on his own policy. The defendant claimed that the broker failed to do this, but to date has not proceeded with his cross-claim against the broker for negligence. 44 It is clear therefore that the Judge should have dismissed the cross-claim against the insurers for lack of proof. Instead, and remarkably, he found that the defendant was entitled to indemnity from the insurer cross-defendants. He said that the cross-claimant alleged that he was covered by a policy issued by Suncorp in respect of dodgem cars in the sum of $1M at an annual premium of $194.36 [par 62]. Counsel were unable to explain this finding. The cross-claim makes no such allegation, Suncorp was not a party to the proceedings, and there was no evidence of the existence of such a policy. 45 The Judge accepted the defendant's evidence of his conversation with Mr Nugent 3 weeks before the Wauchope Show, and added that a renewal certificate in the name of P D Watkins and V V Watkins "was tendered which took effect from 23 January 1991" [par 64]. The only renewal certificate in evidence is that which took effect from 23 January 1990 in favour of the defendant's father. The only basis for this finding is that the defendant said in evidence: "... if you see a policy after that one, it's got P D and V V Watkins, which, we're not talking about that ..." (30). 46 He referred to a submission on behalf of the cross-defendants that the evidence did not support the allegations that the defendant was the owner of the dodgem cars or operated them in partnership with his father. His Honour said: "However it was obvious that there was a loose confederation between members of the family who used when appropriate dodgem cars and other amusement equipment which was part of the family business" [par 65]. This finding, and the evidence on which it was based, was incapable of establishing a partnership between the defendant and his father. The defendant said: "It's a very unclear state because we are a big family" (29), that he and his father shared a lot of things, but there was no partnership on paper: "but I had borrowed a lot of money off him over the years" (30). That evidence could not possibly establish a partnership. 47 The Judge said that the policy was altered "to reflect the true position in the renewal notice issued for the next period of insurance after the accident" [par 67], and he quoted the defendant's evidence summarised above. On the basis of that evidence, and the alteration to the policy on renewal in January 1991, he made the remarkable finding that: "This is evidence that the intention at all times was to have a policy issued which covered the dodgem cars in who ever's possession they were these dodgem cars were identified as being the dodgem cars in the possession of Val Vern Watkins" [par 68]. 48 There was no evidence to support this finding as to "all times" or as to any time before the accident. The defendant had his own policy and three weeks before the show he asked his broker to extend his policy to cover these cars. The partial reimbursement by the defendant of the premium paid by the father behind the insurers' backs did not establish the intention found by the Judge and even if it had it could not vary the policy without notification to and acceptance by the insurers. The cross-claim against these insurers completely failed, and it should have been dismissed with costs. 49 The Judge held that ss 20 and 48 of the Insurance Contracts Act 1984 assisted the defendant in establishing the rights he asserted against the cross-defendants in his statement of cross-claim. However without further evidence, including the terms of the policy, these sections were incapable of having this effect. Section 20 provides that an insurer is not relieved of liability under the contract by reason only that the names of the persons who may benefit under it are not "specified in the policy document". This section would be relevant if a policy purported to cover other persons within some general description such as partners, employees, or sub contractors. In such circumstances the fact that the names of the additional insured were not "specified" in the policy would not avail the insurers. However there was no evidence that the defendant was a person who "may benefit" under his father's policy. 50 Section 48 provides that where a person who is not a party to a contract of general insurance is specified or referred to in the contract, whether by name or otherwise, as a person to whom the insurance cover extends, that person has a right to recover his loss from the insurer in accordance with the contract, notwithstanding that he is not a party to the contract. There was no evidence that the defendant was specified or referred to in his father's policy by name or otherwise as a person to whom the insurance cover extended, and without such evidence the section was irrelevant. 51 The Judge, with the consent of the parties, pronounced orders without giving reasons on 25 January 2002 and, having found a verdict for the defendant in the action, he found a verdict for the cross-claimant against the insurers on the cross-claim, and they were ordered to pay the cross-claimant's costs of the cross-claim. On 18 February 2002 his Honour published his reasons for judgment in which he found a verdict for the defendant in the action with costs, and a verdict for the cross-claimant against the insurers: "in the amount of the damages and costs payable by the cross-claimant to the plaintiff". This was strange to say the least because there were no such damages and no such costs. 52 After further proceedings the trial Judge on 26 April 2002 reversed his orders on the cross-claim against the insurers and ordered that the cross-claim be dismissed, and that the cross-claimant pay the cross-defendants' costs. Then on 26 June 2002 the trial Judge dismissed the defendant's application that the plaintiff indemnify him against the costs of the cross-claim, including the costs he had been ordered to pay the cross-defendants. 53 On 9 August 2002 the defendant applied for leave to appeal from the costs orders made on 26 April and 26 June, having obtained an extension of time from this Court for that purpose. On 22 August 2002 the plaintiff applied for leave to appeal from the judgment for the defendant in the action, having also obtained an extension of time for that purpose. 54 The cross-defendants were joined as opponents in each summons. Their response to the summons of the defendant, filed on 9 October 2002, supported the order for costs in their favour made on 26 April 2002 and did not challenge the Judge's finding that the defendant had established a right to be indemnified under his father's public liability policy. However on 28 March 2003, 6 days before the hearing, the cross-defendants served a notice of contention on the defendant's solicitors seeking to uphold the costs orders made on 26 April 2002 on the ground that the defendant had failed to establish a right to be indemnified under the policy. 55 SCR Pt 51 r 21 does not require a notice of contention to be filed in a summons for leave to appeal but only in an appeal. However r 4C(2)(b)(ii) and (iv) require the opponent's response to a summons for leave to appeal to state the reasons why leave should not be granted and any other relevant matters. Contention points are capable of establishing grounds for the refusal of leave and on any view are relevant matters.

56 The cross-defendants were therefore in default in failing to notify the defendant of their contention points prior to 28 March 2003. However there was no procedural prejudice to the defendant and this particular default was merely the last of many. The defendant himself had needed and obtained an extension of time for the filing of his summons for leave to appeal. The cross-defendants should be permitted to rely on the grounds in their notice of contention. 57 The summonses were fully heard on 3 April with leave reserved to the parties to file supplementary written submissions. On 11 April the defendant's solicitors filed a notice of motion returnable on 28 April which sought an order allowing the tender of the policy conditions as "fresh evidence" in the appeal. The policy conditions cannot possibly constitute fresh evidence for any number of reasons. Moreover an application which should be made not less than 21 days before the hearing, which is made after an appeal has been fully heard, that would require a further hearing in this Court, should normally be entertained only where fresh evidence has been discovered since the hearing. 58 The proposed new evidence comprises pp 2, 4, 6 and 8 out of a total of 9 pages of policy conditions and there is no evidence of the contents of the other pages. The pages that have been produced do not appear to confer any rights on the defendant, at least in the absence of further evidence which would not be within the statement of cross-claim. Reference in this regard may be made to cls 2.1 and 2.2. The application to lead further evidence must therefore be refused. 59 The Court heard argument on the validity of the orders made by the trial Judge on 25 January, 18 February and 26 April 2002, and reference was made to Petitt v Dunkley [1971] 1 NSWLR 376, Storey and Keers Pty Ltd v Johnstone (1987) 9 NSWLR 446, Palmer v Clarke (1989) 19 NSWLR 158 and Todorovic v Moussa (2001) 53 NSWLR 463.

60 These submissions raise substantial questions which need not be resolved in this case and hopefully will never have to be resolved in a future case. They illustrate the practical wisdom behind the decision in Palmer v Clarke, that a District Court Judge has no power to pronounce orders and then give reasons for those orders on a later occasion. The discipline involved in giving reasons before pronouncing orders ensures in most cases that the orders give proper effect to the reasons. If they do not, the parties can raise the question with the trial Judge without delay. 61 In any event the orders pronounced by the Judge on 25 January and 26 April 2002 failed to give proper effect to the Judge's reasons. Although the defendant had succeeded against the plaintiff, in the Judge's view he had established a right to indemnity against the cross-defendants, and on that view, at the very least, judgment should have been given for the cross-claimant for nominal damages and costs. The District Court has no power to make binding declarations of right, but in a proper case an award of nominal damages can have the same practical effect. 62 The policy was not in evidence, but it probably contained a provision entitling the insured to be indemnified against the costs of legal proceedings brought to enforce a claim within the cover. In the circumstances found by the trial Judge, such a clause would have entitled the defendant to judgment against the cross-defendants for his costs of successfully defending the original proceedings, but this relief was not sought. If it had been it might have drawn attention to the fact that the policy was not in evidence and the defendant had failed to prove a right to indemnity against the cross-defendants. 63 The defendant's summons for leave to appeal from the costs orders of 26 April 2002 should be dismissed with costs.

ORDERS Hunt v Watkins & Ors - 40740/02 1. Leave to appeal refused. 2. Claimant to pay opponents' costs.

Watkins v GRE (UK) Ltd & Ors - 40696/02 1. Leave to appeal refused. 2. Claimant to pay opponents' costs. 64 BEAZLEY JA: I have had the benefit of reading in draft the judgment of Handley JA. His Honour has reviewed the factual evidence in this matter so that it is not necessary for me to restate it. I wish, however, to explain briefly why I do not agree with his Honour's conclusion that the appeal should be dismissed. In doing so it is necessary to analyse the trial judge's reasoning process whereby he dismissed the appellant's claim.

65 His Honour, the trial judge, commenced his Judgment with a series of general observations and findings. These are important, because they later come to underpin certain critical aspects of his conclusion. 66 His Honour, at an early stage (para. 5) drew a Jones v Dunkel inference against the appellant for the failure to call Mr. O'Leary. As Handley JA pointed out, that inference was wrongly drawn. 67 His Honour next made a comment as to how the proceedings were conducted before him, namely on the transcript of an earlier hearing, with the appellant being further cross-examined and the defendant, Mr. Watkins, being called to give evidence. His Honour observed that an expert report of Dr. Hill was tendered and that Dr. Hill was not cross-examined and that no expert evidence contrary to Dr. Hill's was called. His Honour then commented: "However [Dr. Hill] did not see the dodgem car which was involved in the event nor did he inspect the rink". (para. 6) 68 I am unsure of the relevance of this comment. There was no suggestion in the case that there was anything particular about the dodgem car that required inspection, nor did the appellant's case depend upon any malfunction of the vehicle. Accordingly, an inspection of the vehicle would not have advanced the appellant's case. Likewise with the rink. The appellant's case was not concerned with the static nature of the rink. Rather, it was concerned with the interrelationship of the rink and the weather conditions. 69 It is possible that his Honour's comment was merely a passing observation in a long judgment and of no specific relevance to the case. If so, it is not a matter of criticism. I have a concern, however, that it is more than that and is the commencement of his Honour's diminution of the relevance of Dr. Hill's evidence. My concern derives from his Honour's introduction of the sentence with the word "However". "However", is a word used to signify a departure from or a contrast with a previously expressed statement. As such, it is an important linguistic tool. Language, of course, is the means by which a judge's reasoning process is exposed. If a judge's reasons are affected by irrelevant matters then, depending upon the extent to which the irrelevancy affects the conclusion, it may be that the reasoning process is flawed. It will be necessary to return to this issue when dealing with his Honour's later treatment of Dr. Hill's evidence. 70 His Honour next commented generally about the appellant's ability to recall the events of the accident, occurring as it did 11 years prior to the hearing. His Honour's comment was appropriate and reflects the long experience of common law courts that a person's memory is affected by the passage of time. He adds, "However when it might have been expected that she would have been certain and precise … on various aspects of the case she was vague and uncertain" (para. 8). This too is an appropriate finding by a trial judge, although his Honour does not at that point enlighten the reader as to the matters he had in mind. 71 His Honour also made a demeanour finding (para. 10), stating: "Unfortunately the manner in which the plaintiff described the events made it extremely difficult to accept her evidence about what she saw making allowances for the fact that she was speaking about events which occurred 11 years before." 72 This finding followed his "summary" of the appellant's evidence, which itself followed a statement that her evidence was "variable" as to the extent of the water on the rink. As his Honour expressed it, the effect of her evidence was that: "the whole of the rink was wet and at the same time she said that there was a large puddle 10 feet by 8 feet near the ticket box". It seems that his Honour, in this statement was finding that the appellant's evidence was inconsistent. As I explain later, this is not a fair assessment of the appellant's evidence. 73 His Honour returned to the appellant's evidence at para. 20. He said: "I conclude that, accepting that part of the evidence of the plaintiff that the whole of the rink was wet, the plaintiff has assumed that it was the fact of the dodgem car going over a wet patch which caused it to slide and hit the side of the rink. I find that her observations as to this event are inaccurate. … I have concluded that she was just wrong about her recollection of what it was that had actually happened." 74 Handley JA has found that this finding cannot be supported. I agree with his Honour for the reasons he gives. Once this finding is removed it removes the fundamental reason underpinning the trial judge's ultimate conclusion with consequences for his verdict in the matter. 75 The question that then arises is whether his Honour's verdict can still be sustained. This requires a review of significant portions of the appellant's evidence. 76 The appellant described the water on the floor of the rink in terms that: "There was a large puddle of water about ten foot by eight, nine foot to one side".

She said the puddle was there when she stepped into the dodgem car (Black 74) and that: "There was a young largish boy, would've been about 14, and he was trying to squeegee off the water, get the water off the track, but it was still continuing to rain so it was sort of pointless". 77 She accurately described the vehicle as having 2 single seats side by side with seat belts. (Black 74) She agreed: "After a period of time … [there] was a build-up of dodgem vehicles in the centre of the rink?

And that Mr. O'Leary had (Black 75): "… tried to avoid it because when you hit the water, the electricity up the top seemed, yeah we tried to avoid it but when there was a pile-up in the middle Paul had to swerve to miss the pile-up and that ended up, we ended up in the puddle , the pool of water, and then it sort of slid across and we hit the piece of timber on the edge of the rink".

She said Mr. O'Leary kept turning the steering wheel (Black 75) but did not gain control of the vehicle before hitting the wall (Black 75). 78 Her evidence was that there was a difference in the motion of the vehicle when it went into the puddle compared to the motion when otherwise driving around the rink. She said that having hit the puddle: "… well you just knew that it was out of control, lost control of it." 79 In cross-examination she denied that collisions with the wall were "happening all the time" (Black 93) and said they "hadn't done that before" (Black 93). When challenged with the proposition that they intentionally hit the side she said: "No we hit this, we got, went to avoid a group of cars that had all got stuck together in the middle of the rink and Paul had swerved to miss this and ended up in this puddle that people were avoiding because of the sparks and the losing control bit and we hit it and boom we hit the side". (Black 93-94)

She was challenged again on this, to which she responded: "Q. And that's what you did isn't it that night, you hit the side of the arena? A. We hit the water and there was water all over that rink, drizzling rain, the roof was leaking and there was that big, one great big puddle that people were trying to avoid and there was the group, they'd all got stuck in the middle and Paul swerved to miss getting caught up in that and we got into that puddle and he lost control and he hit the, went slam into this wood on the side."

The following cross-examination then ensued: "Q. Well you're assuming all this, you didn't see all this did you? A. I was there. Q. I know but you weren't watching him driving this thing were you? You weren't sitting there and consciously watching the way in which he was directing the vehicle.. A. No. … Q. Were you? A. I was aware of what was going on around me. … Q. You see from your experience in riding or driving these small electrically powered vehicles you understand that there's a pedal on the driver's side don't you? A. Yes, yes. Q. And that pedal is spring loaded, you understand that don't you? A. If you tell me so, I'm not mechanically minded. … Q. That when you put your foot on it and press it down it stays down only as long as your foot is on it? A. Right. Q. As soon as you take your foot off it it springs back up? A. Yes. … Q. And what I'm suggesting to you is that these things only move when you keep your foot on the accelerator, do you understand what I mean by that? A. I do understand, yes. … Q. That sometimes people are stopped because they just take their foot off and stop until they're bumped by somebody perhaps, do you understand what I mean by that? A. Yes. Q. Have you any idea why Paul O'Leary didn't just stop this vehicle? A. Because the water with the electricity, I don't know but he lost control and had no, you had no control over where the car was going. … Q. You don't know why Mr. O'Leary didn't just choose not to go through the puddle or just stop the vehicle do you? A. No. Q. In any event you say that he went through the puddle and did he fail to take a bend? A. Well once the car hit the puddle he lost control of the vehicle and it slid and stopped when we hit the, it banged into the support on the side of the rink. Q. But isn't the fact of the dodgem cars such that the wheels on them move in all sorts of directions and people are losing control of them all the time, isn't that what happens with them? A. Well I suppose so. … Q. And so it's fair to say isn't it that you are assuming by reason of the fact that you had a collision, that Mr. O'Leary lost control in the water? A. Yes. … Q. Because the collision occurred shortly after he went through the wet patch? A. Well we hit the wet patch and we slid and hit the wooden bit. … Q. Ws the power suddenly cut off? A. No. Q. But your vehicle stopped suddenly? A. Because we hit the bit of timber on the side of the rink and we hit the water and lost control of the car and it slid, boom. Q. But you didn't hit the rink any harder did you, than if you were pushed by another vehicle perhaps into another vehicle? A. No I'd say we hit it harder …" (Black 98,99,100,101) 80 The appellant was subjected to cross-examination by two further counsel acting for the various cross-defendants. Under cross-examination by counsel for the second cross-respondent she said: "Q. You were unable to tell his Honour what characteristics that particular vehicle had in respect of the steering of it, are you? A. I think it was obvious being there and being on that platform thing that the dodgem cars go on, it was obvious we weren't the only one that it sort of hit the water and it was obvious when you hit the water you lost control". 81 She reiterated that the vehicle behaved differently on the wet part of the track (Black 109). She explained this further by saying that the entire track was wet but on some parts there were "deeper puddles" (Black 110). 82 There was again an attempt made in this cross-examination to attribute responsibility for the accident to Mr. O'Leary failing to take his foot off the clutch: "Q. Now to stop the vehicle were you aware that involved the release of the foot off the pedal? A. Yes that's how you stop a dodgem car, yes. Q. And there was no brake pedal on this vehicle was there? A. No, no. Q. And hence had Mr. O'Leary's foot come off the pedal that would've caused the vehicle to decelerate, is that right? A. You would assume so but I'm not sure with water. … Q. And had Mr. O'Leary taken his foot off the pedal then you would've expected the vehicle to decelerate, is that right? Q. That's what you would expect yes. … Q. Isn't that the position that it was Mr. O'Leary who was in control of the vehicle? A. He was driving the car, yes. Q. And hence he was the person who had the control of the speed at which it was travelling? A. Yes. … Q. See what I'm suggesting to you is this, that had the car hit any puddle of water, one would've expected the driver to remove his foot from the, in effect, accelerator and hence immediately cause deceleration of the vehicle? A. .. (not transcribable).. … HIS HONOUR: Q. At any stage did you see Mr. O'Leary take his foot off the pedal of the car that you were in? A. No. … Q. But you weren't aware at any stage that he'd taken his foot off the pedal? A. Foot off the pedal, no." 83 Counsel for the other cross-defendants took up the same theme: "Q. There's no reason is there why you couldn't have said to Mr. O'Leary that you thought the puddle of water was dangerous and that he should avoid it? A. He was doing - he seemed to naturally do that." 84 All of the above cross-examination came from the first trial, the transcript of which was before his Honour. In the cross-examination which occurred before the trial judge, the appellant was again cross-examined about Paul O'Leary's driving: "Q. If he had taken his foot off the accelerator pedal the dodgem would have stopped? A. It would have stopped, you would assume so". 85 Much of the cross-examination at the first hearing was based upon premises which were technically inaccurate. For example, it was suggested that Mr. O'Leary controlled the speed of the vehicle. That is wrong. As Mr. Watkins described it: "Q. Now the dodgem cars themselves are governed so far as their speed is concerned is that right? A. Yeah they've got a clutch mechanism inside the motor, they are not a direct drive, they are slowly taken off, … they're on a clutch system that slips and spins as the variable - they're called a variable speed clutch." 86 It was also suggested that if he took his foot off the clutch the vehicle would decelerate and/or stop. That question was only correct if the dynamics described by Dr. Hill were not present, so that the appellant's agreement or assumption as to the correctness of the propositions being put to her, was only as accurate as the proposition themselves. Likewise with the suggestion that the dodgem car would only accelerate if the clutch was depressed. This also ignored the dynamics of aquaplaning, to which there was no challenge. 87 That leads me directly to his Honour's findings in respect of Dr. Hill's evidence. His Honour set out the evidence contained in Dr. Hill's report. He then said: "Although Dr. Hill was never questioned on any of these matters, there was no acceptable evidence available which underpinned his opinion". 88 His Honour then made these factual findings. He accepted that the whole surface of the rink was wet. He said it was "likely that this was to varying degrees in varying areas". His Honour continued: "The plaintiff's reliance upon Dr. Hill was challenged on the basis that the defendant said that I would accept Mr. Watkins when he said that it would make no difference how the vehicles behaved whether the surface was wet or dry should be accepted. Whilst this may or may not be so, there was no evidence as to the depth of the water on the rink nor any acceptable evidence from the plaintiff that the car had in terms of Dr. Hill's report had 'aquaplaned'. I agree with the submissions of the defendant that the evidence is equally consistent with a conclusion that Mr. O'Leary drove into the barrier inadvertently. The plaintiff did not at any time see him take his foot off the accelerator pedal." 89 I have difficulty with the conclusions drawn by his Honour in this paragraph. His Honour had earlier found not only that the floor of the rink was wet, but that the wetness varied on different parts of the floor. This could only have been the case if there was more water on some parts of the floor than others. A "puddle" is an accurate description of an area which has more water on it than other areas. That is how the appellant described the state of the floor where she said the dodgem car started to slide and go out of control. His Honour must therefore have accepted the appellant's evidence, that there was a puddle. His Honour had observed, earlier, if my understanding of his reasons is correct, that the appellant's evidence was inconsistent about the state of water on the rink. If he accepted that the amount of water on the rink varied, her evidence could not have been inconsistent. That is another reason why his Honour's ultimate conclusion is flawed. 90 It is also difficult to understand how his Honour could be equivocal as to whether there was a difference between the motion of a dodgem car on a wet or dry surface. Dr. Hill's evidence was that with sufficient depth of water, there was a difference. This evidence was not challenged and this was his very area of expertise. Further, the proposition advanced to his Honour did not represent Mr. Watkins' evidence at all. His evidence, as it emerged in cross-examination, was this: "Q. Would you agree with the proposition that water on the rink was an adverse effect upon the capacity to steer the vehicle in the direction you want it to? A. Well that's providing there was proof there was water on the rink. Q. I'm asking you to assume-- A. If there was, maybe. Q. Well you've seen it before haven't you, I mean-- Q. Yeah but again I'm only, it'd only be my opinion. I'm no expert am I, I'll only be able to say yes or no, you know. Q. Well you'd agree with me wouldn't you that water on the track makes it slippery? A. Well water does make things slippery yes". 91 His Honour then appears to have determined the matter on two bases. First he found, that "there was no evidence as to the depth of the water on the rink". This was relevant as Dr. Hill's evidence was that if the water was more than a few millimetres deep and the velocity up to 8 km/h … "the front wheel of the dodgem would aquaplane". Whilst it is correct that there was no precise evidence as to the depth of water it is important for the evidence to be considered as a whole. "A few millimetres" is a very small measurement. There was both evidence that there was a puddle and his Honour's own finding that the wetness varied over the floor. His Honour appears to have overlooked both of these matters. In doing so, he appears to have failed to consider whether, and if so, what inferences were available to be drawn, both from the evidence and his own finding. 92 This becomes critical when the second basis upon which his Honour determined the matter is considered. His Honour said there was no "acceptable" evidence from the [appellant] that the car had, in the terms of Dr. Hill's report had (sic) "aquaplaned". Presumably, his Honour said there was no "acceptable" evidence because of his finding, expressed later in his report that "her observations as to this event are unacceptable" - a finding which, as I have already stated, has not been accepted by Handley JA or myself. The respondent's evidence that the dodgem car "slid out of control" is only consistent with the dodgem car aquaplaning. If resort is necessary to a dictionary definition of the word 'aquaplane' it is "glide uncontrollably on [a] wet surface …": The Australian Concise Oxford Dictionary. ". 93 His Honour then found that the evidence was "equally consistent with a conclusion that Mr. O'Leary drove into the barrier inadvertently. The plaintiff did not at any time see him take his foot off the accelerator pedal". If the appellant's evidence that the dodgem car behaved differently when it hit the puddle was accepted, there was no basis upon which His Honour could have drawn the alternative inference. There is a catch-22 as once his Honour's finding that the appellant's "observations … are inaccurate" is set aside, the only evidence, given consistently by the appellant was that the car behaved differently once it hit the puddle. In other words, it aquaplaned. It could only have aquaplaned if there was sufficient water on the floor to cause it to do so. As his Honour appears to have accepted both alternatives were open, he could not have rejected the appellant's version. 94 I have referred earlier to his Honour's finding that it was likely that the 'wetness' varied in different places. His Honour, at para. 16, said: "The problem for the plaintiff was whether her evidence of what occurred so long ago should now be accepted as accurate. Her evidence that she had been travelling for 10 minutes on a surface which was, I find, more likely than not all wet, was relevant to the question of the degree of my acceptance of her evidence. The fact that there was a significant difference in the plaintiff's evidence about what occurred could be seen by the fact that she had been travelling for 10 minutes on a surface which was all wet and nothing had adversely occurred to the dodgem car. This would be inconsistent with the views expressed by Dr. Hill." 95 In my opinion, this passage contains findings that are inconsistent with earlier findings, and contains a consequent non sequitur His Honour's finding that the fact that the appellant had been travelling around for 10 minutes without any problem was inconsistent with the views of Dr. Hill, overlooks at least the following matters. First, Dr Hill stated that some depth of water was necessary for the friction between the front rubber wheel and the floor to be removed. His Honour, however, seems to say in this passage that Dr. Hill's evidence was any wetness on the surface was sufficient. That is not what Dr. Hill said and one of the reasons his Honour had rejected the appellant's case was because he considered there was no evidence as to the depth of the water. As I have said there was some such evidence. Further, his Honour in making this statement overlooks or ignores the evidence of the appellant that up until the accident occurred they had been avoiding the puddle. It is also important in assessing the evidence overall to note that it was not suggested to the appellant in cross examination that they had driven through other puddles, or deeper wet areas. 96 I do not consider therefore that his Honour's reasoning in this paragraph withstands scrutiny. 97 I move next to his Honour's conclusions in paras 20 and 22. He said: "20. I conclude that, accepting that part of the evidence of the plaintiff that the whole of the rink was wet, the plaintiff has assumed that it was the fact of the dodgem car going over a wet patch which caused it to slide and hit the side of the rink. … 22. … I find that more likely than not the plaintiff has no real recollection of the condition of the surface of the rink other than that it was all wet. She did not recall the nature and construction of the rink, which is understandable having regard to the effluxion of time however to try and recall and then to suggest that she recalled the precise state of wetness of the rink, and fix upon the defendant the obligation for removing such wetness without the corroborative evidence of Mr. O'Leary, in circumstances where there was action being taken on the part of the defendant to remove any wet area, is in my view unacceptable to place liability on the defendant". 98 As is apparent from this passage his Honour placed emphasis upon the fact that the appellant 'assumed' it was the water which caused the dodgem car to slide. Whilst this corresponds with part of the appellant's evidence it does not accord with all of her evidence. But in any event, I consider this finding confuses an assumption with an inference. The appellant's case cannot, of course, be established by inferences drawn by her. However, it was for the trial judge to make findings of fact on the evidence, including by drawing such inferences as he considered appropriate. I do not consider he embarked upon the latter part of this task. He should have done so. The problem was compounded by his Honour's failure to assess that evidence in conjunction with Dr. Hill's evidence (which he had discarded, in my view wrongly). 99 The next matter for consideration relates of his Honour's finding as to causation (para. 26). His Honour held that even if the appellant was to be accepted: "The position of the collision with the side of the rink and the position of the wet patch identified in the photographs was sufficiently far away from each other to not be able to be said as being likely to be connected, because if the water had interfered with the electrical connection then the motor would have stopped and the car would more likely than not have come to a halt and this it did not do according to the plaintiff's evidence." 100 This finding, which is predicated upon there being a puddle as described, misunderstands the only expert evidence. Dr. Hill said (Blue 43) that if a film of water did come between the floor and front rubber wheel "the effective friction would be almost zero. The dodgem car could not be steered, and removal of the foot from the accelerator would have no effect on the velocity of the car". Conclusion 101 For the reasons I have given I consider that there are errors in his Honour's judgment, inconsistent findings and findings which cannot stand, which affect his conclusion that there was no breach of duty, or if breach, the water on the floor was not causative of the appellant's injuries. Accordingly, I would allow the appeal. That leaves the question of what order should be made. I have not found that an easy question. It is to be resolved, I believe, by asking whether, on the evidence which can be accepted this Court could make its own determination or whether there are credit issues involved which require to be resolved at a trial. In my opinion, the evidence is sufficient even accepting some difficulties in the appellant's case and the Court ought to find a verdict for the appellant. I would allow the appeal with costs.

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